U.S. losing fight against China’s Huawei: Folding phone wars

In a fight that overshadowed the world’s biggest mobile technology trade fair in Barcelona, Spain, the U.S. government’s intense fight to ban Chinese tech giant Huawei from next-generation internet networks appears to be flagging. The introduction of their Mate X hybrid folding phone-tablet may increase demand from tech consumers in America where it appears to be superior to Samsung‘s Galaxy Fold.

The two sides faced
off Tuesday at the world’s biggest mobile technology trade fair, in
Barcelona, Spain, where they sought to win over customers and governments.

The U.S. argues Huawei is
a security risk as it could give the Chinese government backdoor access to
snoop on internet users worldwide. Huawei rejects the claim, which it says is
part of the United States’ broader effort to stifle China’s economic and
technological ascent.

On Tuesday, a top Huawei
executive used a keynote speech at the show, called MWC Barcelona, to poke fun
at U.S. intelligence.

“PRISM, PRISM, on the
wall, who is the most trustworthy of them all?” said Guo Ping, Huawei’s
rotating chairman, in a reference to a U.S. data gathering program.

“If you don’t understand
that, you can go ask Edward Snowden,” he told the audience, referring to the
former National Security Agency contractor who exposed the program in 2013.

Under the PRISM program,
the NSA, pursuant to secret court orders, collected intelligence about foreign
threats through U.S. Internet companies.

In raising the U.S.
government’s history of snooping on citizens, Guo appeared to seek to portray
the United States as hypocritical in accusing the Chinese of being a risk for
users’ data privacy.

Huawei
is the world’s
biggest maker of networking equipment used by phone and internet companies, and
its gear is considered by experts as affordable and high quality.

Banning the company from
supplying the networks — work that is ongoing in many countries this year —
could delay the rollout of 5G networks, which are meant to power the next
generation of technological innovation, from self-driving cars to remote
surgery.

Huawei made its presence
felt at the four-day conference in Barcelona, where some 100,000 visitors are
expected and the company’s red logo featured widely. It unveiled an expensive, new foldable phone that made headlines and turned
attention to a product that’s not facing any global controversy.

The United States
government also dispatched a delegation to lobby its case, which it has pressed
with allies across the world in recent weeks.

“The global nature of data
flows and interconnectedness means that threats to U.S. networks have a direct
bearing on the security of our allies, just as threats to our allies networks have
a direct bearing on the security of the United States,” said Robert Strayer,
the top U.S. diplomat for cybersecurity policy.

“To this end the United
States is asking other governments and the private sector to consider the
threat posed by Huawei and other Chinese information technology companies.”

Strayer did not detail
specific security threats Huawei poses, despite being asked by reporters to do
so in a news briefing on the show’s sidelines.

The U.S. campaign took a
symbolic hit after the United Arab Emirates, a key ally in the Middle East,
said it would use Huawei in its networks. And European allies are balking at
banning the company outright.

Strayer denied Washington
was retaliating as part of a broader trade war between the U.S. and China,
saying the motivation was based on security concerns partly related to Chinese
laws requiring companies to comply with intelligence requests.

Strayer called Huawei
“duplicitous and deceitful,” pointing out that U.S prosecutors have charged the
company with intellectual property theft and allege its chief financial
officer, Meng Wanzhou, committed fraud by misleading banks about Huawei’s
business dealings in Iran.

However, it’s far from
clear that telecom executives in Europe and other regions are buying Washington’s
argument, with leaders of some of the biggest mobile operators calling for
fact-based security assessments.

The U.S. is “fighting an
uphill battle” against the telecom industry, said Paul Triolo, head of
geotechnology at the Eurasia Group consultancy. “They don’t have a smoking gun
here,” so they’re trying to build a stronger case around the company’s behavior
and issues with the Chinese government, he said.

Guo, one of three Huawei
executives who take turns as chairman, said the telecom industry needs unified
standards and clear regulations. He rejected the U.S. allegations.

“We don’t do bad things.
Here, let me say this as clear as possible. Huawei has not and we will never
plant ‘backdoors’ and we will never allow anyone to do so in our equipment.”

Underscoring the company’s
growing momentum in fighting the U.S. allegations, the telecom provider
Etisalat of the United Arab Emirates, a strong U.S. ally in the Mideast, said
it signed a deal with Huawei to deploy its 5G technology. Majority
government-owned Etisalat is one of two main mobile providers in the UAE.

Etisalat offered no
financial terms for the deal it signed with Huawei.

The UAE has increasingly
courted Chinese investment in the country as its real-estate market sags
through a downturn. Chinese construction firms meanwhile rapidly build highway
overpasses and infrastructure at the site of the 2020 World Expo, or world’s
fair, in Dubai. Chinese President Xi Jingping visited the Emirates last June.

The U.S. Embassy in Abu
Dhabi did not immediately respond to a request for comment on the Huawei deal.
The UAE hosts some 5,000 American troops, many at the Al Dhafra Air Base in Abu
Dhabi. Dubai also is the busiest port of call for the U.S. Navy outside of the
United States.

Jeffrey Lang has joined Movie TV Tech Geeks for 2015 and will be providing his opinion on technology from across the pond in London. Along with having many opinions on tech, gadgets, games, etc., he enjoys watching the Thames from our satellite office there.